General Accident, Fire and Life Assurance Corp., Limited, a Corporation v. Independent Military Air Transport Association, a Corporation

The insurer appeals from an adverse judgment imposing liability for appellee’s claim of loss under a policy of fidelity insurance.

Jurisdiction of the District Court was invoked upon the ground of diversity of citizenship [ 28 U.S.C. § 1332 ], and trial by jury was waived. The substantive law of California governs. Guaranty Trust Co. of New York v. York, 1945, 326 U.S. 99, 108-109 , 65 S.Ct. 1464 , 89 L.Ed. 2079 .

The claimed loss is alleged to have resulted from the rifling of appellee’s cash box by a person or persons unknown.

The insuring clauses of the policy include provision that: “If a loss is alleged to have been caused by the fraud or dishonesty of any one or more of the Employees and the Assured shall be unable to designate the specific Employee or Employees causing such loss, the Assured shall nevertheless have the benefit of this Insuring Agreement, provided that the evidence submitted reasonably * * * establishes that the loss was in fact due to the fraud or dishonesty of one or more of said Employees * *

Appellant denied appellee’s claim under the quoted insuring clause and, following trial of the issue, the District Court found that “the evidence adduced…